India’s early automobile manufacturers, visionary though they were, could never have predicted that the country would one day run on wheels. Today, India’s automotive industry is one of the largest in the world, and growing rapidly.

AVTEC is an engine and transmissions business which was spun out of Hindustan Motors in June 2005. The company makes complete engines and transmissions for cars (customers include GM, Ford, Tata and Ashok Leyland), automatic transmissions for off-road vehicles (customers include Caterpillar India, Allison, Voltas and Bharat Earth Movers) and components for each of these.

As an established provider to Indian motor manufacturers, AVTEC is well positioned to benefit from increased domestic demand and from multinational manufacturers outsourcing production of components to countries with lower cost engineering skills.

India’s domestic auto market continued to swell with year-on-year growth of 32% in passenger vehicles, 34% in commercial vehicles, 28% in two-wheelers and 19% in three-wheelers during April and December 2010. Economic recovery, increasing farm income and an improving job market are expected to further propel growth. Even rising interest rates, which have made auto loans more expensive, have not put the brakes on auto sales. As the company strengthens its competitive positioning, Actis continues to work with management to grow the business.